CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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10QSB
1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
May 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
to
Commission file number 0-27963
Captex Capital Inc.
(Exact name of registrant as specified in its charter)
Texas 98-0116179
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2160-650 West Georgia St., Vancouver, B.C. Canada V6B YN7
(Address of principal executive offices (zip code))
604 687-1919
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the last 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.
Class Outstanding at May 31, 2000
Common Stock, par value $.001 5,000,000
PART I -- FINANCIAL INFORMATION
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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ITEM 1. FINANCIAL STATEMENTS
CAPTEX CAPTIAL INC.
(A Texas Corporation)
(A development stage company)
Balance Sheet
(U.S. DOLLARS)
9 months ended Fiscal year ended
May 31, August 31
2000 1999
(Unaudited)
Assets
Incorporation costs $ 1,000 $ 1,000
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Total Assets $ 1,000 $ 1,000
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Liabilities
Current liabilities
Accounts payable $ 3,124 $ 2,000
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Total Liabilities 3,124 2,000
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Shareholders' equity (deficit)
Share Capital
Authorized:
50,000,000 common shares with
a par value $0.001
Issued and outstanding
5,000,000 common shares with
par value of $0.001 at May 31,
2000 and 1,000 at August 31, 1999 1,000 1,000
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1,000 1,000
Accumulated Deficit (3,124) (2,000)
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(2,124) (1,000)
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$ 1,000 $ 1,000
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CONTINUING OPERATIONS (NOTE 1)
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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CAPTEX CAPTIAL INC.
(A Texas Corporation)
(A development stage company)
Statement of Loss
(U.S. DOLLARS)
(Unaudited)
6 months 9 months 6 months 9 months
ended ended ended ended
February 28, May 31, February 28, May 31,
1999 2000 1998 1999
Expenses
Legal $ 647 $ 1,124 $ - $ -
Interest and
bank charges - - - -
Filing fees - - - -
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Net earnings (loss)
for the period $ (647) $ 1,124 $ - $ -
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Basic and diluted
loss per share $ (0.00013) $ (0.00023) $ - $ -
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Weighted average
shares Outstanding 5,000,000 5,000,000 1,000 1,000
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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CAPTEX CAPTIAL INC.
(A Texas Corporation)
(A development stage company)
Statement of Cash Flow
(U.S. DOLLARS)
(Unaudited)
6 months 9 months 6 months 9 months
ended ended ended ended
February 28, May 31, February 28, May 31,
1999 2000 1998 1999
Cash provided by
(used in)
Operations
Net Loss for
period $ (647) $ (1,124) $ - $ -
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(647) (1,124) - -
Net change in
non-cash
working
capital
balances
Accounts
payable 647 1,124 - -
Accrued
interest - - - -
Convertible
Debenture - - - -
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Net cash used in
operating activities - - - -
Financing
Issuance of
capital stock - - - -
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Net cash
--------
generated
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by financing
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activities - - - -
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Change in cash
for period - - - -
Cash, beginning
of period - - - -
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Cash, end of period $ - $ - $ - $ -
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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CAPTEX CAPITAL, INC.
(formerly Strand Capital, Inc.)
(A Texas Corporation)
(A development stage company)
Notes to Financial Statements
Period ended May 31, 2000
(U.S. DOLLARS)
1. Continuing operations
Captex Capital Corp. was incorporated on November 5, 1990 in the state of
Texas, U.S.A. The Company changed its name from Strand Capital Inc. on
October 26, 1999.
The Company has negative working capital and a deficit. The ability for
the Company to continue as a going concern is dependent upon its ability to
obtain adequate financing to reach profitable levels of operations. It is
not possible to predict whether financing efforts will be successful or if
the Company will attain profitable levels of operations.
2. Summary of significant accounting policies
These financial statements have been prepared in accordance with generally
accepted accounting principles in the United States and reflect the
following significant accounting principles:
a. Estimates and assumptions
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make assumptions
that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amount of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
b. Earnings (loss) per common share
In February, 1997, the Financial Accounting Standards Board issued
Statement No. 128, Earnings Per Share (SFAS 128), which established new
standards for computing and presenting earnings per share effective for
fiscal years ending after December 15, 1997. With SFAS 128, primary
earnings per share is replaced by basic earnings per share, which is
computed by dividing income available to common shareholders by the
weighted average number of shares outstanding for the period. In
addition, SFAS 128 requires the presentation of diluted earnings per
share, which includes the potential dilution that could occur if
dilutive securities were exercised or converted into common stock.
The computation of diluted EPS does not assume the conversion or
exercise of securities if their effect is anti-dilutive. Common
equivalent shares consist of the common shares issuable upon the
conversion of the convertible loan notes and special warrants (using
the if-converted method) and incremental shares issuable upon the
exercise of stock options and share purchase warrants ( using the
treasury stock method).
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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c. Cash and cash equivalents
Cash and cash equivalents consist of cash on hand, deposits in banks
and highly liquid investments with an original maturity of three months
or less.
3. Share Capital
On October 26, 1999, the Company amended its certificate of incorporation
by increasing its authorized capital stock to 50,000,000 shares of common
stock and changing the par value of its common shares to $0.001 par value
per share. Also, the Company converted and split the common stock into
five thousand shares with the result being that the Company has 5,000,000
shares of issued and outstanding stock.
4. Income taxes
The Company has net operating losses, which may give rise to future tax
benefits of approximately $2,000 as at August 31, 1999. To the extent
not used, net operating loss carryforwards expire in varying amounts
beginning in the year 2012. Income taxes are accounted for in accordance
with Statement of Financial Accounting Standards No. 109 (SFAS 109).
Under this method, deferred income taxes are determined based on
differences between the tax basis of assets and liabilities and their
financial reporting amounts at each year end, and are measured based on
enacted tax rates and laws that will be in effect when the differences
are expected to reverse. Valuation allowances are established, when
necessary, to reduce deferred tax assets to the amount expected to be
realized. No provision for income taxes is included in the statement due
to its immaterial amount.
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Company has registered its common stock on a Form 10-SB
registration statement filed pursuant to the Securities Exchange Act of
1934 (the "Exchange Act") and Rule 12(g) thereof. The Company files with
the Securities and Exchange Commission periodic and episodic reports under
Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-QSB
and annual reports Form 10-KSB. As a reporting company under the Exchange
Act, the Company may register additional securities on Form S-8 (provided
that it is then in compliance with the reporting requirements of the
Exchange Act) and on Form S-3 (provided that is has during the prior 12
month period timely filed all reports required under the Exchange Act).
The Company was formed to engage in a merger with or acquisition of an
unidentified foreign or domestic private company which desires to become a
reporting company whose securities have been registered under
the Exchange Act. The Company may be deemed to meet the definition of a
"blank check" company contained in Section (7)(b)(3) of the Securities Act
of 1933, as amended.
Management believes that there are perceived benefits to being a
reporting company which may be attractive to foreign and domestic
private companies.
These benefits are commonly thought to include
(1) the ability to use securities to make acquisition of assets or
businesses;
(2) increased visibility in the financial community;
(3) the facilitation of borrowing from financial institutions;
(4) improved trading efficiency;
(5) the potential for shareholder liquidity;
(6) greater ease in subsequently raising capital;
(7) compensation of key employees through options for stock for which there
may be a public market;
(8) enhanced corporate image; and,
(9) a presence in the United States capital market.
A private company which may be interested in a business combination
with the Company may include
(1) a company for which a primary purpose of becoming a reporting company
is the use of its securities for the acquisition of assets or
businesses;
(2) a company which is unable to find an underwriter of its securities or
is unable to find an underwriter of securities on terms acceptable to
it;
(3) a company which wishes to become a reporting company with less
dilution of its common stock than would occur normally upon an
underwriting;
(4) a company which believes that it will be able obtain investment
capital on more favorable terms after it has become a reporting
company;
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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(5) a foreign company which may wish an initial entry into the United
States securities market;
(6) a special situation company, such as a company seeking to satisfy
redemption requirements under a qualified Employee Stock Option Plan;
and,
(7) a company seeking one or more of the other benefits believed to attach
to a reporting company.
Management is actively engaged in seeking a qualified private company
as a candidate for a business combination. The Company is authorized to enter
into a definitive agreement with a wide variety of private businesses without
limitation as to their industry or revenues. It is not possible at this time to
predict with which private company, if any, the Company will enter into a
definitive agreement or what will be the industry, operating history, revenues,
future prospects or other characteristics of that company.
As of the date hereof, management has not made any final decision
concerning or entered into any agreements for a business combination. When any
such agreement is reached or other material fact occurs, the Company will file
notice of such agreement or fact with the Securities and Exchange Commission on
Form 8-K. Persons reading this Form 10-QSB are advised to see if the Company
has subsequently filed a Form 8-K.
The Company does not intend to trade its securities in the secondary
market until completion of a business combination. It is anticipated that
following such occurrence the Company will take the steps required to cause its
common stock to be admitted to quotation on the NASD OTC Bulletin Board or, if
it then meets the financial and other requirements thereof, on the Nasdaq
SmallCap Market, National Market System or regional or national exchange.
COMPUTER SYSTEMS REDESIGNED FOR YEAR 2000
Many existing computer programs use only two digits to identify a year in
such program's date field. These programs were designed and developed without
consideration of the impact of the change in the century for which four digits
will be required to accurately report the date. If not corrected, many computer
applications could fail or create erroneous results by or following the year
2000 ("Year 2000 Problem"). Many of the computer programs containing such date
language problems have not been corrected by the companies or governments
operating such programs. The Company does not have operations and does not
maintain computer systems. However, it is impossible to predict what computer
programs will be effected, the impact any such computer disruption will have on
other industries or commerce or the severity or duration of a computer
disruption.
Before the company enters into any business combination, it will inquire as
to the status of any target company's Year 2000 Problem, the steps such target
company has taken to correct any such problem and the probable impact on such
target company of any computer disruption. However, there can be no assurance
that the Company will not combine with a target company that has an uncorrected
Year 2000 Problem or that any such Year 2000 Problem corrections are sufficient.
The extent of the Year 2000 Problem of a target company may be impossible to
ascertain and its impact on the Company is impossible to predict.
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CAPTEX CAPITAL, INC. - 10QSB - Quarterly Report Date Filed: 09/15/2000
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PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There are no legal proceedings against the Company and the Company is
unaware of such proceedings contemplated against it.
ITEM 2. CHANGES IN SECURITIES
On October 26, 1999, the company amended it certificate of incorporation by
increasing its authorized capital stock to 50,000,000 shares of common stock and
changing its authorized capital to $0.001 par value per share.
As well, the Company split the common stock into 5000 shares with the result
that the Company has 5,000,000 shares of issued and outstanding common stock
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Not applicable.
(b) Reports on Form 8-K
There were no reports on Form 8-K filed by the Company during the quarter.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CAPTEX CAPITAL, INC.
By: /s/ John MacKay
John MacKay, President
Dated: September 15, 2000
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